Mesut Yavas | Kent u een businessplan

1. Do You Know Business Plan? Kent u een businessplan? Mesut Yavas

2. Contents of Business Plan Executive summary Industry and Company and ts products /Services Market Research and Analysis Economics of the Business Marketing Plan Design and Development Plans Manufacturing and operations plan Management Team Overall Schedule Critical risk problems and assumptions Financial Plan Proposed Company offering Appendices ◼ ◼ ◼ ◼ ◼ ◼ ◼ ◼ ◼ ◼ ◼ ◼ ◼

3. Executive Summary ◼ Description of the Business Concept and the Business Opportunity and strategy ◼ Target market and projections ◼ Competitive advantage ◼ Costs ◼ Sustainability ◼ The Team ◼ The Offering - Finance needed (Debt equity and your contribution) ◼

4. Industry ,Company and Product/Service ◼ The industry current state, ◼ size, ◼ growth ◼ competitors, ◼ new product/devp, ◼ environmental profile –energy intensity, supply chain, waste, green technology –carbon credits CER)

5. Company and the Concept ◼ Company and the Concept – ◼ present biz, products service offered /will offer, ◼ background of growth and promoters involvement, ◼ prior sales and profit performance or discuss losses and why ◼ and improvements done or envisaged

6. Product or Service Product and or service – describe of new product service , application of its use , delivery system unique features how they add value, differentiation from those current available, possible drawbacks, present state of development, first mover of head start advantage any features which give you unfair advantage over others like patents trade secrets or proprietary features, opportunities of expansion of product lines or related products. ◼ ◼ ◼ ◼ ◼ ◼ ◼ ◼ ◼

7. Entry and Growth Strategy ◼ Entry and growth strategy – Key success variables in mktg plan innovative product, ◼ timing advantage, ◼ marketing approach, ◼ pricing , ◼ channels of distribution advertising and promotion ◼ ◼

8. Market Research and Analysis ◼ Customers ◼ Market size and trends ◼ Competition and competitive edges ◼ Estimated market share and sales ◼ Ongoing market evaluation

9. Customers ◼ Who are they? Classified by groups segments-common identifiable characteristics ◼ Where are they? Segment and region ◼ How they buy (retail /wholesale), reached and receptiveness? ◼ Where buying decisions are made and length of decision cycle, customers purchase process, basis of decisions (price, quality timing, delivery training, service personnel, contacts, political pressures) and can they change current buying decisions?

10. Customers(2) ◼ What orders contracts or letters of commitment or potential customers you have in hand? ◼ What you are doing to overcome negative customer reaction? ◼ If in existing business , current customers and sales trends

11. Market Size ◼ Five year projections of size and your share, by segment, region or country for product or service ◼ Potential annual growth for at least 3 years ◼ Major factors for market growth ( industry trends, socio economic trends, govt. policy, envrt. impact, population shifts) ◼ review previous trends

12. Competition and Competitive Edge Realistic SWOT of Competitors, assess substitute and alternatives ,list of suppliers of these ◼ Compare competing and substitute products or services on market share, price ,quality, performance , delivery, timing service, warranties, other features ◼ Current advantages and disadvantages of these products ◼

13. Competition and Competitor’s Edge Knowledge of competitors actions that could lead to improved products (R&D) Are they awake or asleep? SWOT of competing companies their market share sales and distribution Financial position ,costs and profitability of competitors Who are service providers pricing, performance ,cost and quality leaders-why co exiting or entered the business Discuss 3-4 key competitors and why customers buy from them What you know of competitor’s operations ◼ ◼ ◼ ◼ ◼ ◼ ◼ ◼

14. Economics of the business ◼ Gross and operating margins ◼ Profit potential and durability ◼ Fixed variable and semi variable costs ◼ Months to breakeven ◼ Months to reach positive cash flow

15. Marketing plan ◼ Overall marketing Strategy ◼ Pricing ◼ Sales and tactics ◼ Service and warranty policies ◼ Advertising and promotion ◼ Distribution

16. Design and development plan ◼ Development status and tasks ◼ Difficulties and risks ◼ Product improvement and new product ◼ Costs ◼ Proprietary Issues

17. Manufacturing and Operation plan ◼ Operating cycle ◼ Geographical allocation ◼ Facilities and improvements ◼ Strategy and Plans ◼ Regulatory and Legal teams

18. Management team ◼ Organisation ◼ Key management personnel ◼ Management Compensation and Ownership ◼ Other investors ◼ Employment and other agreements and stock options and Bonus Plan ◼ Board of Directors ◼ Other shareholder’s rights and restrictions ◼ Supporting professional advisers and services

19. Overall Schedule ◼ A schedule that shows the timing and interrelationship of the major necessary to launch the venture and realise its objectives. ◼ Cash conversion cycle will underline key inputs ◼ Deadlines indicated ◼ Indicates to investors your depth of planning and resource use ◼ Indicate methods of calculations

20. Critical Risks Problems and Assumptions ◼ Demonstrate that you have thought out and can handle them ◼ Description of risks implicit in plan ◼ Assumptons- use objectivity to deal with it – sales projections, orders ◼ Consequences of adverse outcomes – industry, company, personnel, product, market appeal ◼ Unstated negative factors of investors

21. Contingencies – Indicate critical ones ◼ Running out of cash before orders come in ◼ Price cutting by competitors ◼ Potentially unfavorable industry trends ◼ Costs excess of estimates ◼ Sales projections not achieved’ ◼ Unmet product development schedule Difficulty in procuring long lead items ◼ Difficulties in obtaining bank credit ◼ Increase in R&D costs ◼ Running out of cash after orders come in ◼

22. Financial Plan -Best Estimate of Reqt. Indicate venture’s potential and timetable for financial viability ◼ Operating plan for fin mgt using fin benchmarks ◼ Prepare exhibits ◼ Use three year income statements and balance sheets and break even analysis. For cash flow statement use cash system instead of accrual system ◼ Give assumptions behind -sales levels, growth, inventory requirements, cash balances, operating and cash conversion cycles ◼

23. Fin Plan (2) ◼ Proforma income statement – plan for profit indicates potential fin. feasibility of the venture. ◼ Initially, level of profits cannot finance operating assets and cannot match the actual cash flow on a short term basis, hence a forecast of cash needs should take care of such conditions is recommended.

24. Fin Plan (3) ◼ Proforma balance sheets are used to detail the assets required for the projected level of operations and how they will be financed (liablilities) ◼ Indicate projected debt equity ratios, working capital, current ratios, inventory turnover within the limits required to justify future financing

25. Financial Plan (2) ◼ acceptable limits to justify future financing ◼ Break even chart showing level of sales that will cover all costs including those that vary with production and those that do not Income statements -In Proforma statements fully discuss bad debts, discounts, assumptions for sales expenses, general and administrative costs ◼

26. Fin Plan(2) ◼ ,show effect of sales reduction say 20%, learning curve and level of productivity snesitivity of profits to risks ◼ Prepare Balance sheets, cash flow analysis, Break even charts ,cost control measures and budget overrun ◼ Highlight important conclusions, including maximunm amount and timing of cash required , amount of debt and equity needed, how fast debts will be repaid

27. Financial Plan ◼ Actual Income Statements and balance Sheet ◼ Proforma Income statements ◼ Proforma Balance Sheets ◼ Proforma Cash Flow Analysis ◼ Breakeven Chart and Calculations ◼ Cost control ◼ Highlights

28. Proposed Company offering ◼ Amount of money being sought ◼ Nature of security offered to investors ◼ Summary of how the investor can expect to achieve his targeted rate of return ◼ Terms for financing your company spelt out here ◼ Description of Uses of Capital ◼ Desired Financing –how much

29. Proposed Company Offering Offering – common stock, convertible,debentures, debts with warrants, debt plus stock,unit price, total amount of securities (if not common , interest rate,type,maturity and conversions conditions, percentage others can hold before and after conversion, private placement –restrictred securities for a period of time Capitalisation – current and proposed (post offfering number of outstanding shares and how the holding will change after on completion of fnancing), authorised and issued capital, stock options ◼ ◼

30. Offering (3) ◼ Use of funds – how capital raised will be used- R&D,capital eqpt, marketing , working capital ◼ Investors Return- Indicate how your valuation and proposed ownership pattern will result in in desired rate of return for investors whom you have targeted

31. Appendices Information too extensive in the body but necessary ◼ Product specification Photos List of references Suppliers of critical components Special location factors Facilities Technical analysis Consultant reports Critical regulatory approval or licences

32. Thank You